The last two years were defined by uncertainty and instability. What does this mean for companies?
It is not the first crisis we've faced in the last ten years. Since the financial crisis, the euro crisis and the euro-franc shock – the most recent major crises exporting SMEs faced before the pandemic – companies have had to be able to switch into crisis mode overnight. That may seem harsh, but it was precisely these situations that enabled businesses to shift quickly to crisis mode when necessary. The pandemic is certainly unique in its implications and the scenarios were unforeseeable, but certain tools and experiences were nevertheless useful. The same now applies to the war in Ukraine.
What problems are SMEs experiencing because of the war between Russia and Ukraine?
On the one hand, the de facto export ban to Russia is certainly an issue. This affects about 2% of Swiss exports. In macroeconomic terms, this does not have an especially large impact, but depending on the company and its export share, such sanctions can be an existential threat. Initially, the main problems were certainly the legal questions regarding current procurements or export projects, or relating to payment transactions, logistics and staff secondments. On the import side, the interrupted supply chains are causing difficulties, leading to massive delivery delays and increases in the prices of many products and materials.
To what extent are Liechtenstein and Swiss SMEs feeling the effects of the sanctions imposed on Russia and which sectors are particularly affected?
Fears are most pronounced among companies that manufacture chemical products, those in retail, or in the mechanical and electrical engineering industries.
Around 200 companies in Switzerland and Liechtenstein have branches in Russia, and even if the aforementioned export ban is manageable on the whole, individual companies may lose an entire economic mainstay, which is very hard.
This means that companies are looking for alternatives to compensate for the loss of these markets, and here we see firms seeking stable and more predictable markets where opportunities can be realized in the short and medium term. We are currently experiencing high demand for the EU area and the entire American continent.
How do companies deal with the uncertainties regarding market access to the EU?
Every SME does it differently, but in principle it's about planning reliability, which is the prerequisite for entrepreneurship of any kind. Medical technology was the first sector to feel the increased requirements for exporting their products to the EU and the difficulties this entails. Companies did have time to prepare and were able to take measures, which is also good for the future, but it is important to have clarity and stability. Moreover, the adjustments also involve increased costs and strong competitive pressure from companies in the EU, which of course have a competitive advantage within the Union.
How can Switzerland Global Enterprise help in concrete terms?
We are present in 31 countries and keep our eyes and ears open in the markets. We offer support, mediation and access to our international network of experts and expertise on all internationalization topics – from information and personal advice, through market analyses and legal clarification, to the mediation of sales partners or customers, or guidance in the target market. Companies have become more selective in their expansion, and we have exactly the tools necessary to identify the right markets. Every year we implement around 800 projects and support a good 5000 companies in Switzerland and the Principality of Liechtenstein. Liechtenstein companies that use our services can benefit from an export check from the Office of Economic Affairs.
